rabble blogs are the personal pages of some of Canada's most insightful progressive activists and commentators. All opinions belong to the writer; however, writers are expected to adhere to our guidelines. We welcome new bloggers -- contact us for details.

EU environment committee debates investor protections in Canada-EU trade deal

Please chip in to support more articles like this. Support rabble.ca today for as little as $1 per month!

The European Parliament's committee on the environment, public health and food safety debated the investment chapter and investor-state dispute settlement process in the Canada-EU free trade deal today at the request of Greek MEP Kriton Arsenis (pictured). You can watch the short discussion, which includes a rebuttal from the European Commission, by clicking here and scrolling to minute 12:24). Arsenis has been outspoken inside and outside parliament against investor-state arbitration and didn't hold his punches in today's debate.

The Greek socialist MEP told committee members that when the EU took over competence, or jurisdiction, for investment from European member states in the December 2009 Lisbon Treaty, there was hope that the democratic deficit in these bilateral investment treaties would be corrected. In reality, in the first application of the new competence in the Canada-EU Comprehensive Economic and Trade Agreement, "it has proven to be less protective of the environment and more harmful of democracy," he said.

Arsenis asked the Commission how it will stop the practice of treaty shopping, where a company pretends to be from Canada using a subsidiary in order to sue the EU or a member state under CETA's generous investment rules. He also asked how CETA will block financial speculators from funding frivolous investor-state cases for corporations who otherwise would not risk their own cash.

In a worrying sign, Socialist trade committee chair Bernd Lange followed his colleague's presentation by saying his political group does not have a problem with the type of mechanism used to protect investment -- state-to-state versus investor-to-state -- but the types of policies that are covered.

"We need to make sure environment, health and social legislation are not seen as an object to investor-state disputes," said Lange. "We have to be careful in the deal with Canada."

The problem with this position is that it gives too much credit to the ability of governments (in this case Canada and the European Commission) to limit the definitions of what would amount to a breach of "fair and equitable treatment" under CETA, what kinds of policies would be found to indirectly expropriate an investor's profits, and when a government would have to compensate an investor or corporation for environmental decisions that reduce or eliminate the ability to profit from whatever activity they were hoping to engage in (e.g. fracking for natural gas).

According to adjunct law professor Matthew Porterfield, writing for the International Institute for Sustainable Development in March, though the United States and Canada have tried to limit "fair and equitable treatment" to a customary international law standards -- be fair and don't abuse foreign investors -- the paid arbitrators handling these cases tend to ignore this and refer to past investor-state disputes. What the EU wants in CETA is even worse: an open-ended definition of both fair and equitable treatment and expropriation, which will put many more policies at risk, and create a chill effect on governments looking to pass new environmental protection rules.

In response to the presentations by Arsenis and Lange, a European Commission official attempted to downplay any concerns with investor-state dispute settlement in CETA and elsewhere. This is the most natural thing for the EU to be doing in its trade deals, he said.

"What's at stake is not legislation in itself but rather the way an investor is treated. Contrary to state-to-state (dispute settlement, as in at the WTO), the only remedy is a monetary one. There's never a case of legislation being repealed or otherwise."

Really? Because in the last version of CETA's investor-state dispute settlement chapter we have seen, the EU is proposing that a tribunal should absolutely have the authority to order the repeal of the government measure that is found to violate the investment rules in the deal. Under Article x-20: Final Award, the text reads as follows. (Brackets around text mean it is not agreed yet, Canadian proposal and European proposals are in italics.)

1. Where a Tribunal makes a final award against the respondent finding a breach of the provisions of the Investment Protection Chapter CAN [or the Investment Protection and Establishment Chapters], the Tribunal may award, [in a manner sufficient to compensate the loss suffered by the claimant / investor], separately or in combination, only:

(c) EU [repeal of the measure concerned provided that the respondent may pay monetary damages and any applicable interest in lieu of repeal. Where repeal is not sufficient to compensate for the loss suffered by the claimant, the respondent shall also pay monetary damages.]

Canada does not seem to have agreed to the EU proposal yet, and Canadian negotiators are proposing their own aggressive language. For example, Canada wants to define an investor as someone that "seeks to make, is making or has made an investment in the territory of the other Party." According to investment treaty experts, this could grant Canadian firms broad rights to challenge European policy even without already having any investment or presence in Europe.

The Commissioner told today's meeting "we think we're trying to improve the system, with the goal of reducing as much as possible the risk of litigation. This is not only an important question but a technical one." But in several areas that we've seen in CETA, the European proposals will make it more likely that Canada or EU member states will face punishing, multi-million dollar lawsuits for many democratic decisions that impede an investor's right to profit from their investment, even if there are obvious environmental or social implications of that investment.

The Commissioner told the environment committee there will be an in-camera technical meeting on investor-state dispute settlement at the European Parliament's trade committee meeting on May 16. We'll keep our ears open and report back if we hear anything. In the meantime, if you want to let Canadian politicians know you are opposed to reproducing NAFTA-like investor rights in the Canada-EU trade deal, click here to use a Registered Nurses' Association of Ontario action alert.

Thank you for reading this story…

More people are reading rabble.ca than ever and unlike many news organizations, we have never put up a paywall – at rabble we’ve always believed in making our reporting and analysis free to all, while striving to make it sustainable as well. Media isn’t free to produce. rabble’s total budget is likely less than what big corporate media spend on photocopying (we kid you not!) and we do not have any major foundation, sponsor or angel investor. Our main supporters are people and organizations -- like you. This is why we need your help. You are what keep us sustainable.

rabble.ca has staked its existence on you. We live or die on community support -- your support! We get hundreds of thousands of visitors and we believe in them. We believe in you. We believe people will put in what they can for the greater good. We call that sustainable.

So what is the easy answer for us? Depend on a community of visitors who care passionately about media that amplifies the voices of people struggling for change and justice. It really is that simple. When the people who visit rabble care enough to contribute a bit then it works for everyone.

And so we’re asking you if you could make a donation, right now, to help us carry forward on our mission. Make a donation today.


We welcome your comments! rabble.ca embraces a pro-human rights, pro-feminist, anti-racist, queer-positive, anti-imperialist and pro-labour stance, and encourages discussions which develop progressive thought. Our full comment policy can be found here. Learn more about Disqus on rabble.ca and your privacy here. Please keep in mind:


  • Tell the truth and avoid rumours.
  • Add context and background.
  • Report typos and logical fallacies.
  • Be respectful.
  • Respect copyright - link to articles.
  • Stay focused. Bring in-depth commentary to our discussion forum, babble.


  • Use oppressive/offensive language.
  • Libel or defame.
  • Bully or troll.
  • Post spam.
  • Engage trolls. Flag suspect activity instead.